Need a car, truck or van for your business? Compare financing options

Compare business vehicle financing options

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Get access to the funds you need to buy your next business vehicle.

The right vehicles are essential to the functioning of many businesses, offering the mobility and portability you need to operate successfully. However, when it comes to finding the funds to purchase your next business vehicle, there is a wide range of vehicle finance options you can choose from. This includes a range of leasing and loan options. Each option has its own benefits and drawbacks, so read on to discover which one may be right for you.
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    What is business vehicle financing?

    Business vehicle financing refers to several different borrowing options that can help cover the cost of a new car, truck, van or other vehicle for business use. Your options are similar to auto loans, but you might not have the same selection of lenders and could have to meet different application requirements.

    Which type of financing works best for your business depends on a range of factors including its financial situation, taxation needs and whether you’ll use the vehicle solely used for business purposes or a mix of business and personal use.

    Top business lenders for vehicle financing

    Rates last updated August 19th, 2018
    Unfortunately, none of the business loan providers currently offer loans for these criteria.
    Name Product Product Description Min Loan Amount Max. Loan Amount Requirements
    Kabbage Small Business Line of Credit
    A simple, convenient online application could securely get the funds you need to grow your business.
    $500
    $250,000
    Must have been in business for at least 1 year. Revenue minimum is $50,000 annually or $4,200 per month over the last 3 months.
    LoanBuilder, A PayPal Service Business Loans
    Customizable loans with no origination fee for business owners in a hurry.
    $5,000
    $500,000
    Annual business revenue of at least $42,000, at least 9 months in business, personal credit score of 550+.
    Lending Express Business Loan Marketplace
    $5,000
    $500,000
    At least 3 months in business and $10,000+ in monthly revenue. Your business might also qualify if it's been in business at least 6 months with $3,000+ in monthly revenue.
    Excel Capital Management Small Business Loans
    Get personalized financing options that suit your unique business needs in just a few simple steps.
    Varies by loan type
    Varies by loan type
    Your business must operate in the US, be at least 1 year old and have monthly revenue of $15,000+.
    LendingTree Business Loans
    Multiple business financing options in one place including: small business loans, lines of credit, SBA loans, equipment financing and more.
    Varies by lender and type of financing
    Varies by lender and type of financing
    Varies by lender, but you many require good personal credit, a minimum business age and minimum annual revenue.
    LendingClub Business Loans
    With loan terms that vary from 1 to 5 years, enjoy fixed monthly payments and no prepayment penalties through this award-winning lender.
    $5,000
    $300,000
    2+ years in business; $50,000+ in yearly sales; No bankruptcies or tax liens; At least 20% ownership of your business; Fair or better personal credit
    Fora Financial Business Loans
    No minimum credit score requirement and early repayment discounts for qualifying borrowers.
    $5,000
    $500,000
    Business age 6+ months. Monthly revenue $12,000+. No open bankruptcies.
    OnDeck Small Business Loans
    A leading online business lender offering flexible financing at competitive fixed rates.
    $5,000
    $500,000
    Must have been in business for at least one year with annual revenue of $100K+. Must have a personal credit score of 500+.
    National Business Capital Business Loans
    Get a large business loan to cover your financing needs, no matter what the purpose is. Startups welcome with 680+ credit score.
    $10,000
    $5,000,000
    Your company must have been in business for at least 6 months and have an annual revenue of at least $180,000.
    Seek Business Capital Funding Solutions
    Startups and newer businesses could qualify for loans and credit cards with a custom financing package.
    $5,000
    $150,000
    Personal credit of 680+, no bankruptcies in the last 4 years.
    BizLoans.io Business Loan Marketplace
    Get connected with wide range of loan amounts and multiple loan types from reputable lenders.
    $20,000
    $500,000
    Must have good credit and at least 6 months in business.

    Compare up to 4 providers

    How does business vehicle financing work?

    Business vehicle financing works a lot like other types of auto loans. If your business doesn’t want to pay for a vehicle upfront, financing kicks in to break up the cost into more manageable payments that you pay over a period of time plus interest or fees.

    How commercial vehicle finance works depends on which type of financing you go for. Some options allow you to borrow a vehicle from a dealer without ever owning it. Other options allow you to purchase the vehicle in full.

    What are my business vehicle financing options?

    Your business has a number of vehicle financing options to choose from, though it’s rare to find a lender that offers all at once. Use the following list to help you decide which is best for your business and start your search from there.

    Business auto loan

    A business auto loan allows you to buy the vehicle under your name or your business’s name and then pay the lender a fixed monthly repayment. If you take out a loan in your business’s name, your lender might require a personal guarantee from all business owners if your business’s finances aren’t strong enough.

    You can get business auto loans from online lenders, banks, credit unions and even directly from the manufacturer or dealership. These loans tend to require a down payment of around 10% to 20%.

    Lease

    This option allows your business to use of a commercial vehicle without ever owning it. The lender purchases the vehicle on your behalf, and then leases it back to you. You then make monthly lease payments until the term of the lease is up.

    Once your lease is over, you typically have the options to pay off the remaining value on the lease and take full ownership of the vehicle, trade the vehicle for a new one in or look to refinance the lease. Business vehicle leases usually don’t come with a down payment.

    Commercial line of credit

    Need financing for more than one vehicle? Some lenders allow you to use a business line of credit that you can use to buy or lease multiple cars, trucks, vans and more to help you build your fleet.

    You’ll only have to get approved once so you won’t have to spend all that time waiting to get approved for each individual vehicle. However, your business will likely need to have strong credit and a consistently high revenue to qualify.

    SBA commercial vehicle loan

    Having trouble qualifying for traditional vehicle financing. Your business might be eligible for a Small Business Administration (SBA) vehicle loan. These loans are backed by the SBA, meaning that they come with competitive rates and fees. However, they can take a while to process and have extensive eligibility requirements, so it’s not ideal if your business is in a rush.

    Heavy-duty vehicle financing

    These are designed specifically for large trucks and other heavy-duty vehicles, which you might have difficulty financing with your typical car loan.

    Like with the commercial line of credit, your business can use this option to build your fleet but typically requires your business to have been around for at least two years, have strong credit and consistently high revenue.

    Specialty vehicle financing

    This option is best for businesses looking to modify a vehicle or buy specialty equipment — what you can’t typically get at an auto dealership. Specialty financing can help your business buy equipment to make better use of vehicles your business already owns, like a wheelchair lift, crane or towing equipment. Some lenders allow you to combine this option with a lease or auto loan.

    Personal loan

    A personal loan gives you access to funds you can use for a variety of purposes, ranging from improving your home to buying a car. This option can be great if you plan to use the car for personal and business use. Treat it as a last resort, however: Personal loans tend to come higher interest rates and fees than some other business vehicle financing options.

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    How can I find the best vehicle financing for my business?

    • Terms. The length of the term of your vehicle finance arrangement will influence how much money you have to pay in order to gain ownership of a commercial vehicle. Many finance options allow terms of between one and seven years, so compare the terms available and find an option that suits your budget and needs.
    • Interest rate. What interest rate will you be charged under your vehicle finance arrangement? The higher the rate, the more you’ll have to pay in interest charges. Will the rate be fixed or variable, offering either the security of knowing what your repayments will be or the chance to take advantage of possible falling rates?
    • Repayment options. Look for a vehicle finance option that allows you to tailor repayments to suit your budget. Some offer fixed monthly repayments which provide security, while others may allow you to choose a more flexible repayment schedule.
    • Tax requirements. Claiming the expense of buying a vehicle as a tax deduction varies greatly depending on which vehicle finance option you choose. You may also be able to include depreciation deductions depending on the option you choose.
    • Fees and charges. As with any financial product, it pays to familiarize yourself with any fees and charges attached to a vehicle finance option. They may not seem like much at first, but these expenses can add up to a lot of money in the long run.

    Buying vs. leasing a vehicle for your business

    Buying a vehicle means you’ll own it once you’ve paid for it in full. Leasing means you can use it for a fixed amount of time without getting all of the benefits and drawbacks of ownership. Here’s how the two options stack up.

    Buying a vehicleLeasing a vehicle
    Typical initial costDown payment of around 10% to 20% of vehicle cost.Security deposit of the first month’s payment.
    OwnershipYour business owns the car as soon as the paperwork is signed.Your business can buy the car after your lease is up for a large balloon payment.
    Tax benefitsYour business can deduct depreciation and mileage expenses from your its taxes.Your business can deduct mileage from its taxes.
    MaintenanceYour business is responsible for maintenance costs.You might be charged a fee if your car needs excessive maintenance once you’re done with it.

    Are there any risks involved with business vehicle financing?

    As with any financing option, one of the most important thing to avoid is getting in over your head. Having debts pile up on top of one another can hurt your business, so make sure you can afford a vehicle finance arrangement before you sign up to it.

    Another common pitfall is simply not understanding the range of vehicle finance options available and selecting one that doesn’t suit your business’ needs and budget. Enlisting the services of an accountant can help.

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